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With vCloud Air sale, VMware clears cloud computing path

With the sale of its long languishing vCloud Air offering this week, VMware found a way to step away from the product that has had an uncertain future for quite some time.

The company sold its vCloud Air business to OVH, Europe’s largest cloud provider, for an undisclosed sum, handing off its vCloud Air operations, sales team and data centers to add to OVH’s existing cloud services business.

But VMware isn’t exactly washing its hands of the product. The company will continue to direct research and development for vCloud Air, supplying the technology to OVH – meaning VMware still wants to control the technical direction of the product. It also will assist OVH with various go-to-market strategies, and jointly support VMware users as they transfer their cloud operations to OVH’s 20 data centers spread across 17 countries.

The sale of vCloud Air should lift the last veil of mist that has shrouded VMware’s cloud computing strategy from the start for years. VMware first talked about its vCloud initiative in 2008, and six years later re-launched the product as vCloud Air, a hybrid, IaaS offering for its vSphere users. It never gained any measurable traction among IT shops, getting swallowed up by a number of competitors, most notably AWS and Microsoft.

The company quickly narrowed its early ambitions for vCloud Air to a few specific areas, such as disaster recovery, acknowledged Raghu Raghuram, VMware’s chief operating officer for products and cloud services, in a conference call to discuss the deal.

Further obscuring VMware’s cloud strategy was EMC’s $12 billion purchase of Virtustream in 2015, a product that had every appearance of being a competitor to vCloud Air. This froze the purchasing decisions of would-be buyers of vCloud Air who waited to see how EMC-VMware would position the two offerings.

Even a proposed joint venture between VMware and EMC, called the Virtustream Cloud Services Business, an attempt to deliver a more cohesive technical strategy, collapsed when VMware pulled out of the deal. Dell’s acquisition of EMC, and by extension VMware, didn’t do much to clarify what direction the company’s cloud computing strategy would take.

But last year VMware realized the level of competition it was up against with AWS and made peace with the cloud giant, signing a deal that makes it easier for corporate shops to run VMware on both their own servers as well as servers running in AWS’ public cloud. Announced last October and due in mid-2017, the upcoming product will be called VMware Cloud on AWS, that lets users run applications across vSphere-based private, hybrid and public clouds.

With the sale of vCloud Air, the company removes another distraction for both itself and its customers. Perhaps now the company can focus fully on its ambitious cross-cloud architecture, announced at VMworld last August, which promises to help users manage and connect applications across multiple clouds. VMware delivered those offerings late last year, but the products haven’t created much buzz since.

VMware officials, of course, don’t see the sale as the removal of an obstacle, but rather “the next step in vCloud Air’s evolution,” according to CEO Pat Gelsinger, in a prepared statement. He added the deal is a “win” for users because it presents them with greater choice — meaning they can now choose to migrate to OVH’s data centers, which both companies claim can deliver better performance.

Hmm, well that’s an interesting spin. But time will tell if this optimism has any basis in reality.

After the sale is completed, which should be sometime this quarter, OVH will run the service under the name of vCloud Air Powered by OVH. Whether it is wise to keep the vCloud brand, given the product’s less-than-stellar success, again, remains to be seen.

Ed Scannell is a senior executive editor with TechTarget. Contact him at escannell@techtarget.com.

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I am very optimistic about vCloud powered by OVH.
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